luxury goods research presentation - … digital impact will likely increase as mobile penetration...
TRANSCRIPT
TOTAL RESPONDENTS: 1,061 MALE: 86%
FEMALE: 14%
€80,000 /$100,000+ HH INCOME: 76%
€200,000/$250,000+ HH INCOME: 33%
ABOUT THE
RESPONDENTS
2
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293 RESPONDENTS
199 OTHERS
RESPONDENTS
389 RESPONDENTS
180 RESPONDENTS
DIGITAL NOW IMPACTS NEARLY
HALF OF ALL LUXURY PURCHASES
Less than 10% of luxury purchases are done online but
this is growing at 25-30% a year
The digital impact will likely increase as mobile
penetration increases and Millennials become the
majority of luxury customers.
4
McKinsey and the Altagamma Foundation Digital Luxury Experience Report 2013 / Google Insights - How Affluent Shoppers Buy Luxury Goods
Luxury brands have followed customers into the digital world giving customers access
to more information than ever before and giving brands access to new customers.
HOW DOES DIGITAL IMPACT RELATIONSHIPS
WITH LUXURY BRANDS? 5
THE RISING MIDDLE CLASS PRESENTS
NEW LUXURY CONSUMERS
The 15 fastest growing emerging markets will
provide 90% of the growth in consumption of luxury
goods in the next 10 years (led by China)
6
Source: Euromonitor, Deloitte Global Powers of Luxury Goods 2014 , Economist Special Report Luxury Goods 2014
9%
19%
25%
2008 2013 2020
% Luxury Market from Asia Pacific, Latin
America, and the Middle East and Africa
Mature
Consumers (Elites in developed countries)
The traditional luxury
customers. The Americas had
the strongest YoY growth at
6% in 2014 – Bain Luxury Goods
Report 2014
Defined as based in North
America or Europe and
age 35+
7
The Rising Middle Class
The number of big-city
households in emerging
markets with incomes of more
than $70k per year to triple by
2025 - McKinsey
Defined as those based in Asia
(India, Hong Kong, Singapore
and Thailand)
Millennials
By 2026 ,they will be the main
consumers of luxury - Unity
Marketing
Defined as under age 35
Mature
Consumers (Elites in developed countries)
The traditional luxury
customers. The Americas had
the strongest YoY growth at
6% in 2014 – Bain Luxury Goods
Report 2014
Defined as based in North
America or Europe and age
35+
EXPERIENCING OVER OWNING 9
MATURE CONSUMERS
The Economist Group Luxury Goods Survey 2014
69%
19%
11%
A trip to an exotic
location or an activity
you've wanted to try
A new technology
product such as a
smartphone, tablet or TV
A fashion item: apparel,
jewellery, watch or other
accessory
Imagine you were given some money to treat
yourself to one thing, which of the following would
most appeal to you?
10%
11%
14%
19%
28%
29%
36%
37%
Other (please specify)
Fashion shows featuring the brand's
products
An opportunity to meet the brand's designer
Interactive online features such as the ability
to design custom/bespoke products
Early access to products
Exclusive in-store events or pop-up events
Videos showing how the product is made
Stories about the brand in video or
print/online editorial
Which of the following experiences are of most interest to
you from luxury brands?
THEY PREFER BRAND-RELATED EXPERIENCES
OVER PRODUCT-RELATED ONES 10
MATURE CONSUMERS
The Economist Group Luxury Goods Survey 2014
Implication: Deliver experiences that integrate the brand’s story while giving customers an
experience that forms part of their identity
The Rising Middle Class
The number of big-city
households in emerging
markets with incomes of more
than $70k per year to triple by
2025 - McKinsey
Defined as those based in Asia
(India, Hong Kong, Singapore
and Thailand)
IN CHINA, CONSUMERS
USE LUXURY TO SHOW
THEY’VE ‘MADE IT’
Majority of luxury products bought by the Chinese are
purchased outside of the country
82% of Chinese travellers said shopping was a crucial part
of their travel plans
13
RISING MIDDLE CLASS
The Economist Explains: China's addiction to luxury goods
RESPONDENTS IN ASIA ARE MORE DRIVEN BY
CONSPICUOUS CONSUMPTION 14
RISING MIDDLE CLASS
The Economist Group Luxury Goods Survey 2014
21%
22%
30%
25%
31%
32%
37%
47%
52%
0% 10% 20% 30% 40% 50% 60%
Owning products
from luxury brands
helps me stand out
from the crowd
I want to associate
myself with certain
brands
Luxury goods help
show off my personal
taste and style
To what extent do you agree with these statements about why
you buy luxury goods?
Asia
Europe
North America
37%
41%
66%
0% 10% 20% 30% 40% 50% 60% 70%
Very/somewhat important
How important is it for luxury companies to offer you experiences
that are only available to a select number of customers?
Asia
Europe
North America
EXCLUSIVITY IS HUGELY IMPORTANT 15
RISING MIDDLE CLASS
The Economist Group Luxury Goods Survey 2014
THE CHINESE ARE BECOMING MORE
OPEN TO TRYING NEW BRANDS
70% of Chinese consumers are likely to try different brands and styles
Nearly 45% of respondents plan to buy more emerging luxury brands in the next three years
- Bain & Company’s 2014 China Luxury Market Study
16
RISING MIDDLE CLASS
*Source: Bain & Company’s 2014 China Luxury Market Study
IN ASIA, THEY ARE MORE OPEN TO
TRYING NEW BRANDS 17
RISING MIDDLE CLASS
The Economist Group Luxury Goods Survey 2014
88%
79% 79%
I am open to purchasing a product from a brand I have not previously
owned
Asia
Europe
North America
3%
19%
18%
21%
36%
39%
39%
48%
Other (please specify)
Fashion shows featuring the brand's products
An opportunity to meet the brand's designer
Interactive online features such as the ability to
design custom/bespoke products
Early access to products
Exclusive in-store events or pop-up events
Videos showing how the product is made
Stories about the brand in video or print/online
editorial
Which of the following experiences are of most interest to you from
luxury brands?
THEY CARE ABOUT THE BRAND’S STORY
BUT EXCLUSIVITY IS EQUALLY IMPORTANT 18
RISING MIDDLE CLASS
The Economist Group Luxury Goods Survey 2014
Implication: As luxury is a success symbol for this audience, established luxury brands can use their
heritage as a point of differentiation that emerging luxury labels can’t match. This differentiation
provides exclusivity that this audience can appreciate and view as a status symbol.
Millennials
By 2026 ,they will be the main
consumers of luxury - Unity
Marketing
Defined as under age 35
21
MILLENNIALS
The Economist Group Luxury Goods Survey 2014
MILLENNIALS DRIVEN BY
THE VALUES OF
LUXURY BRANDS
79%
67%
I enjoy reading about the history behind the
brand
Millennials Older generation
LUXURY REPRESENTS WHO MILLENNIALS
WANT TO BE 22
MILLENNIALS
The Economist Group Luxury Goods Survey 2014
29%
34%
51%
48%
56%
62%
I want to associate myself with certain
brands
I feel successful when I buy luxury goods
Luxury goods are special and wearing
them makes me feel good
To what extent do you agree with these statements about why you
buy luxury goods?
Millennials
Older generation
Implication: A luxury brand’s story can be used as a way to spark aspiration for this
audience. By showing what the brand stands for and its passions, Millennials can relate
to these values and adopt it to their own lifestyle.
BRAND NARRATIVE IS MORE IMPORTANT
THAN EVER 24
Insights What it means
Mature customers
Rising middle class
Millennials
Mature customers are valuing
luxury experiences over products
but the brand’s story behind the
experience is still important.
Deliver experiences that integrate the
brand’s story while giving customers
an experience that forms part of their
identity.
Luxury means that they’ve ‘made
it’ but as they become more
knowledgeable about the
market, they are open to trying
emerging label brands.
Established luxury brands can use their
heritage as a point of differentiation
that emerging luxury labels can’t
match which provides the exclusivity
and status this audience seeks.
A luxury brand’s values are
important to this audience
because these values are
symbolic of who this audience
aspires to be.
Telling the story of what the brand
stands for can relate to the lifestyle
that Millennials aspire to live in
the future.